Lieberman on climate bill prospects

WASHINGTON (Reuters) - Senate Republicans could withhold support of key legislation such as a climate-change bill if Democrats ram a healthcare reform bill through the Senate using fast-track procedures, Senator Joseph Lieberman said on Wednesday.

"What worries me," Lieberman said, "is Republican colleagues I've talked to, some of them usually trying to work with Democrats on individual pieces of legislation, have said to me if healthcare reform is forced through by reconciliation, nothing bipartisan is going to happen this year."

Lieberman, a Connecticut independent, is working with Democratic Senator John Kerry and Republican Senator Lindsey Graham to forge a compromise, bipartisan climate-change bill forcing U.S. reductions in greenhouse gas emissions blamed for global warming.

While such legislation is one of President Barack Obama's highest priorities, healthcare reform is his top priority.

To win quick passage of expanded healthcare, Obama and fellow Democrats in Congress are planning to use a special procedure, known as "reconciliation," to overcome a solid wall of Republican opposition in the Senate.

Referring to that tactic, Lieberman fretted it could poison the atmosphere for a climate bill he hopes will pass this year, despite heavy odds against it with members of both parties concerned about such a sweeping bill in an election year.

"We have a lot of important things we should do besides healthcare reform this year, including energy-independence climate-change legislation," he added. "There are Republicans working on this who want to support this."

Lieberman also told Reuters during a brief interview:

-- "I'm interested in cap and dividend but I don't like it better yet" than cap and trade.

Cap and trade, the centerpiece of a climate bill passed by the House of Representatives last year, would place continually-declining limits on smokestack emissions of carbon dioxide and other greenhouse gases blamed for global warming. It also would establish a huge financial market for trading carbon pollution permits that companies would have to obtain.

Under cap and dividend, similarly strict limits could be placed on carbon pollution. But instead of focusing on smokestack emissions, it would aim the cap on upstream operations, such as on coal and oil companies and importers. The "dividend" would be in the form of monthly checks to consumers to help ease the cost of higher energy prices and without the complicated trading scheme of cap and trade.

-- "I'm thinking about" a plan to initially place carbon limits only on the electricity-generating utility sector, which accounts for about 40 percent of U.S. carbon emissions. He would not specify which mechanism could be picked to achieve the limits.

-- "Clearly under consideration" is a proposal to put off any carbon-emission requirements on manufacturers, giving time for alternative energy sources, such as wind and solar power, to develop at a cheaper cost.

-- Would a tax on the transportation sector spell doom for a climate bill? "I don't know. I think people are open to considering. People have talked about it. We're talking to our colleagues about it. It depends how the tax is applied and what happens to the money," he said.

-- "I probably was a little optimistic there" with a forecast on Tuesday that a detailed outline of a compromise bill could be set forth within days. Key decisions still must be made, he said.

(Editing by Philip Barbara)